Assume that the market can be represented by the supply and demand curves: Qs = 6P...

Question

Question

Assume that the market can be represented by the supply and demand curves: Qs = 6P - 60 Qp = 60 - 4P If the price is 14 (P=14

Answer 1

Answer #1

At the price of 14,

Quantity demanded = 60-4*14

= 4 units.

Quantity supplied = 6*14 - 60

= 84-60

= 24 units.

We can see that the quantity demanded is less than the quantity supplied, so there will be a surplus of good at this price.

Surplus = Quantity supplied - Quantity demanded

= 24 - 4

= 20 units.

So, at the price of 14, we can see that the surplus is 20 units.

So, option 2 is the correct answer.

IF YOU FIND THIS ANSWER HELPFUL, PLEASE UP VOTE.

Answer 2

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